Is Russian Steel Being Imported for the Keystone XL Pipeline?

Some of the steel used for the Keystone XL pipeline was manufactured by a Canada-based Russian subsidiary, while some is made in the U.S. and other countries.

In early March 2017, after various publications reported that President Donald Trump had walked back vows to require that controversial Dakota Access and Keystone XL pipelines be completed with American-made steel, some headlines and accounts to intimated that steel for the pipelines’ construction was instead being imported from Russia.

The public perception that Russian steel is pouring into the United States to complete the two pipelines seems to have been drawn from an MSNBC segment hosted by Joy Reid and a report in the environmental publication DeSmogBlog, both of which were widely shared on Facebook.

DeSmogBlog reported that some of the steel used for KXL was manufactured in Canada by the Russian subsidiary Evraz:

DeSmog has uncovered that 40 percent of the steel created so far was manufactured in Canada by a subsidiary of Evraz, a company 31-percent owned by Russian oligarch Roman Abramovich, who is a close ally of Putin and a Trump family friend. Evraz has also actively lobbied against provisions which would mandate that Keystone XL’s steel be made in the U.S.

And on the 5 March 2017 broadcast of the MSNBC show “AM Joy,” Reid said:

One pipeline that will be exempted from Trump’s ‘buy American’ rule, the Keystone XL. A White House spokesperson confirmed this week that the Keystone will not be required to be built with American steel. Instead, much of the steel pipe is being provided by Mumbai-based Welspun Corp and by a subsidiary of Evraz PLC, a Russian company partly owned by the Russian billionaire Roman Abramovich whose wife Dasha Zhukova is a friend of Ivanka Trump even reportedly attending the inauguration as her guest.

But although those reports discussed the fact that the Keystone XL (KXL) pipeline will be exempted from a presidential order of 24 January 2017 requiring that, whenever possible, new pipelines in the U.S. must be constructed with domestically-produced steel, they didn’t state that steel manufactured in Russia was currently being imported in the U.S. for use in building those pipelines. And company representatives told us materials for both pipelines were purchased years before Russia was accused of meddling in the 2016 presidential election.

Social media users also shared what appeared to be an unrelated local news report about the opening of a new port in New Jersey in which officials mentioned that a cargo ship was carrying steel slabs from Russia, raw material to be used in U.S.-based manufacturing:

Doric Warrior made its final leg of a long journey to Paulsboro from Russia. The ship, 230 meters long, carried the first shipment of steel to the Paulsboro Marine Terminal. Crews worked tirelessly to unload some of the steel before Senate President Steve Sweeney and Assemblyman John Burzichelli, the men who envisioned and backed the port since day one, would welcome guests to mark the occasion.

In 2012 TransCanada, the firm building Keystone XL, published a press release saying 50 percent of the pipeline steel would be manufactured in Arkansas by Welspun, a Mumbai-based company, and 24 percent would be manufactured in Canada by Evraz, a subsidiary of Russia-based Evraz PLC. DeSmogBlog linked to a 2012 study published by Cornell University that put the Evraz number far higher, saying it the company would manufacture 40 percent of the steel for KXL.

Terry Cunha, spokesman for TransCanada, told us that all of the materials for the project are purchased already and that none of them came from Russia:

It’s been sitting in storage across the U.S. and Canada and that material will be used if we get a presidential permit. When we bought the material it was all Canadian, not Russian steel.

In the case of the Dakota Access pipeline, Energy Transfer Partners spokeswoman Vicki Granado told us the materials were also already purchased, saying: “Because of the manufacturing timeline required for a 1,172-mile pipeline all the pipeline was purchased and manufactured well in advance of construction, which has been underway since May of 2016.” Lisa Dillinger, another spokeswoman for ETS, told us just over 40 percent of the steel was manufactured in Canada but said information about which company made it was not immediately available:

57% of the pipeline was manufactured in the U.S. (Stupp in Baton Rouge and Welspun in Little Rock), which at the time of the order represented all the available U.S. capacity. The remaining pipe was manufactured in Canada.

Because the materials for the two pipelines in question have already been purchased, it’s doubtful that the steel aboard the cargo ship in New Jersey was imported for the purpose of building either. According to the International Trade Administration, Russia is the world’s fourth largest exporter of steel (sending between 400,000 and 1 million metric tons to the United States) so a shipment of the material from that country is not automatically cause for suspicion:

Russia is the world’s fourth-largest steel exporter. In year to date 2016 (through September), further referred to as YTD 2016, Russia exported 22.7 million metric tons of steel, a 4.2 percent increase from 21.8 million metric tons in YTD 2015. Russia’s exports represented about 6.5 percent of all steel exported globally in 2015. The volume of Russia’s 2015 steel exports was almost equal to the world’s third-largest exporter, South Korea, and less than a third of the volume shipped by the world’s largest exporter, China. In value terms, steel represented just 3.5 percent of the total amount of goods Russia exported in 2015.

Although it’s apparent that the Russian company Evraz manufactured some of the pipeline for the Keystone XL project, it’s unclear whether they also manufactured steel for Dakota Access. Shortly after President Trump signed orders allowing the completion of the pipelines to proceed, the Evraz’s North American subsidiary posted an approving tweet:

Because Russia is a major steel exporter, it is probable that some product from that country will be used in a variety of American infrastructure projects. We found no evidence that Russia is currently shipping steel to the United States for KXL or Dakota Access pipeline construction, although some of the steel used for KXL cames from Canada, where Evraz has subsidiaries in Regina and Camrose. Further, according to company representatives the material for both pipelines was purchased years before the Kremlin was accused of interfering in the 2016 U.S. presidential election.